Prague, 2 July 2003 (RFE/RL) -- Discussion in the Western press today centers on the cautious progress seen this week in the Middle East, the EU's foundering stability and growth pact, the controversy surrounding Italy's assumption of the rotating EU Presidency, and Balkan membership in the European Union, among other issues.

THE WASHINGTON POST:

An editorial discussing recent events in the Middle East says after 33 months "of unrelenting violence and misery, from which there often appeared to be no prospect of an exit, life on the ground between Israelis and Palestinians at last has taken a significant turn for the better." On 30 June, Israeli troops pulled out of the Gaza Strip, thus reopening a north-south throughway "that had been closed to Palestinian traffic since the beginning of the Palestinian uprising in September 2000. As early as today, Israeli forces are also expected to leave Bethlehem, in the West Bank."

On the Palestinian side, security forces seem to be maintaining control, and three of the five main Palestinian militant groups have announced a temporary cease-fire on violence against Israel. "Not all the shooting has stopped," says the paper, and "the obstacles to the nascent peace process remain daunting. But at last there is something to celebrate." The recent progress also furnishes more proof that "concerted engagement" by the administration of U.S. President George W. Bush "can get results."

FINANCIAL TIMES:

An editorial today says the EU's stability and growth pact "has long since ceased to function as envisaged." The pact was originally designed to keep the economies of EU members in line and ensure none of them ran an "excessive deficit" of more than 3 percent of GDP.

Europe's economic and monetary affairs commissioner, Pedro Solbes, "delivered a stark warning" to Germany yesterday, cautioning Berlin not to breach the 3 percent deficit limit for a third straight year in 2004. The pact was instituted to ensure "a political commitment to budgetary discipline, a means of preventing lax fiscal policy, and a punishment system for persistent offenders. All three elements are either dead or dying," the "Financial Times" says. The political commitment is challenged by the persistent actions of Germany and other EU states, nor does it serve as a preventive. "Portugal, France and Germany have excessive deficits [and] others are likely to follow," says the paper.

The financial daily says the 3 percent of GDP target rate is outmoded and no longer guarantees the consolidation of Europe's budgets. "It is time, therefore, to redefine an excessive deficit to take account of debt levels, future pension liabilities and the cyclical position of European economies. Without such a change, the stability pact confers neither legitimacy nor credibility."

THE WASHINGTON TIMES:

The paper's assistant national editor, Jeffrey Kuhner, says the European Union is attempting to pressure the nations of the former Yugoslavia to form another artificial Balkan union before joining the EU. Brussels has made clear that membership is in these countries' futures. Yet it is insisting upon the fulfillment of certain conditions before this can be achieved. Economic reform, human rights protections, and crackdowns on organized crime and corruption are all a part of the deal. But another key step, Kuhner says, is the negotiation of a Stabilization and Association Agreement with the EU, also known as the Balkan Stability Pact.

The Balkan pact would create a regional economic union "based on a Balkan free-trade zone, characterized by close 'inter-border' cooperation and loose political links." But this proposal is "deeply unpopular" among the region's citizens, says Kuhner. Moreover, it is not politically viable. "One of the great lessons of the 20th century is that artificial, multiethnic states incorporating peoples who do not want to live together are not sustainable in the long run," he says. Balkan nations have finally achieved their long-sought independence. Now, "[under] the guise of 'progress' and 'ethnic reconciliation,'" the EU is planning to artificially regroup these nations in a plan that is "destined to fail."

Writes Kuhner: "Brussels is essentially telling the peoples of the region they are unable to govern themselves and can only enter the EU as a regional bloc, not on an individual basis as have the other countries of Europe." And this "amounts to being treated as second-class Europeans."

THE WALL STREET JOURNAL EUROPE:

A contribution to the European edition by Francis Rocca discusses Italy's accession to the rotating EU Presidency yesterday. Center-right Italian Prime Minister Silvio Berlusconi has proved a controversial figurehead for Europe, due largely to his giant private holdings in the Italian media and the recent legal decision to grant him immunity from bribery charges until after his tenure as prime minister. But Rocca remarks that regarding Italy's immunity law, "such protections for heads of government are the norm in the EU and beyond." Just last week in France, a constitutional amendment spared President Jacques Chirac from prosecution "on a host of fraud and kickback charges as long as he remains in the Elysee Palace."

Rocca goes on to note many of Berlusconi's critics feel "that the prime minister's political gains are ill-gotten, due to his domination of Italian television. The prime minister owns three of the country's seven TV networks and, as head of government, theoretically controls all three of the state-owned networks." Rocca says, "This is, on its face, hardly a propitious arrangement for political dialogue." But the growth of satellite and digital television as well as the Internet and other media could soon marginalize Berlusconi's apparent domination of the media. Moreover, as the recent vociferous Europe-wide criticism of the prime minister in the press shows, his media holdings "hardly [give] him an unfair edge on the wider European stage."

THE INDEPENDENT:

An editorial in the British daily asks, "Is Silvio Berlusconi a fit man to speak for Europe?" He is a "strong and charismatic leader," the paper says. The fact that Italy has long lacked "the diplomatic or political clout she was entitled to had much to do with her endemic political instability. But now no one can be in any doubt as to who runs Italy and will speak for Europe," says the paper. "Even so, that welcome element of certainty does not make Mr. Berlusconi a suitable man."

The British daily goes on to say that Berlusconi uses "uncompromisingly xenophobic" rhetoric on the issue of immigration, which he has already made clear will be part of his focus during Italy's turn at the helm of Europe. Berlusconi's tone has an "unfortunate historical resonance with Italy's fascist and imperialist past," the paper says.

Berlusconi's leadership of Italy has also drawn criticism for his much-publicized "interfering" in judicial processes and the media. "Of course other EU states harbor corruption and tolerate sharp practice by politicians," the paper says. "But none combine these with the sort of politics that Mr. Berlusconi and his Forza Italia allies stand for."

But the EU seems "unwilling to face up to the reality of Berlusconism," the paper writes. The Union seems to be trying to either "wish [him] away" or indulge him as a "useful pro-American ally." But ultimately, says the paper, the EU "is in a state of denial" about "who has emerged as its international figurehead."

EURASIA VIEW:

Iranian affairs analyst and journalist Ardeshir Moaveni (a pseudonym) discusses Iran's recent widespread student-led protests. The demonstrations began in protest of a plan to privatize the nation's universities and eventually resulted in over 4,000 arrests in the most widespread Iranian uprising since July 1999.

The high-stakes political maneuvering that has followed "underscores the inability of reformists and conservatives to cooperate," Moaveni says. The "volatile atmosphere has prompted reform-minded supporters of President Mohammad Khatami's administration and their conservative opponents to strive to develop new political tactics in Iran's ongoing domestic leadership struggle."

Reformists are themselves divided over how to proceed, says Moaveni. Some seek to align themselves with the students' cause. But others believe "too much solidarity with students could hamper reformists' overall efforts to gain concessions on free speech and independent media from the conservatives."

But while Khatami's reformist allies "struggle with tactics," some observers note "that important elements in the conservative camp are reluctant to press on with the crackdown, fearing that if events turned bloody Iran could find itself more vulnerable to foreign interference," including from the United States. This view may have been lent credence by Supreme Leader Ayatollah Ali Khamenei's call on 12 June for restraint in dealing with the protesters.

LE MONDE:

Writing in France's leading daily, Marie Jego says the dreams of wealth of the Caspian littoral states are slowly fading. In the years following the collapse of the Soviet Union, this oil- and gas-rich region -- comprising Turkey, Russia, Iran, Azerbaijan, Kazakhstan, and Turkmenistan -- was looking at "a beautiful future," Jego says. But today, the combination of the region's identity crises, recurring economic problems, and authoritarian regimes has undermined the hoped-for prosperity. Tensions among these states also remain over dividing up the area's resources, and the status of the Caspian Sea remains difficult to define.

Moreover, the region remains a theater of contention between Washington and Moscow, who compete for influence with rival plans for pipelines and gas mains. But the general decline in oil and gas prices, the anticipated arrival of Iraqi oil in the market, the degradation of the investment climate, and Russia's increasing demand for energy from its former satellite states have undermined the opening up of the region. The construction of the Baku-Tbilisi-Ceyhan (BTC) pipeline connecting Azerbaijan to Turkey via Georgia thus became the chief focus of U.S. policy in the region.

Relations between Western oil companies and Caspian region authorities have also taken a bad turn, Jego says. Delays have plagued production and Kazakh authorities, with control over one of the largest reserves, have at times threatened to renegotiate contracts or renationalize certain deposits. The recent arrest (30 March) of U.S. businessman James Giffen, an adviser to the Kazakh president, has also highlighted the region's problems with widespread corruption.